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Inside Mortgage Finance

November 10, 2016

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CFPB, Dodd-Frank May Be in the Crosshairs of Trump Administration, GOP-Controlled Congress

Mortgage lenders and servicers could see a dramatic change in the regulatory environment following the election of Donald Trump as president with a GOP-controlled Congress. During a campaign of many and sometimes conflicting promises, Trump vowed to repeal the Dodd-Frank Act, which would require Congressional action and, if carried out in its entirety, would abolish the Consumer Financial Protection Bureau. Some observers think a more likely outcome is a restructuring of the CFPB itself and curbing of some regulatory and enforcement actions, perhaps with new leadership. Mortgage lending issues were... Read More

Private MIs Lose Some Market Share to Government Programs During 3Q16, Radian Keeps Top Ranking

The primary mortgage insurance market remained on track for its best year ever during the third quarter of 2016, as the government-insured sectors gained some ground on private MIs, according to a new Inside Mortgage Finance ranking and analysis. Mortgage lenders originated a record $220.46 billion of home loans with some form of primary MI during the third quarter, a 16.6 percent increase from the previous period. That brought year-to-date primary MI activity to $553.77 billion, just $92.40 billion less than the all-time annual record of $646.17 billion set in 2015. The government-insured market – mostly FHA and VA – was...[Includes three data tables] Read More

Fannie Moratorium on Bulk MSR Transfers Could Cause Headaches; Ginnie Acknowledgement Agreement Delayed

Come February 1 of next year, Fannie Mae will temporarily halt bulk transfers of mortgage servicing rights as it upgrades its reporting systems, a change the industry has known about for quite some time, but one that still promises to cause headaches. The moratorium runs from Feb. 1, 2017, through March 31, according to Fannie lender letter LL-2016-01, at a time when seller-servicers are implementing new investor reporting requirements. The government-sponsored enterprise is advising servicers that if they want to avoid disruption they “should not propose post-delivery servicing transfer effective dates that fall during” the two months. According to investment bankers that buy and sell servicing rights for a living, the moratorium can be worked... Read More

A Tale of Two Nonbank Giants: Ocwen’s Outlook Improves, While PHH Continues to ‘Self Liquidate’

PHH Corp. and Ocwen Financial – both large publicly traded nonbank mortgage lenders – released third quarter results suggesting that at least one of them, Ocwen, might have a future. Ocwen, which has been bleeding red ink for roughly two years, posted net third-quarter earnings of $9.4 million, though there were several caveats to its results, including previously announced legal settlements that have yet to be paid. Still, Ocwen continued... Read More

GSE Low-Downpayment Program Numbers Still Too Low to Report, FHFA Researching Obstacles

Low-downpayment programs introduced by Fannie Mae and Freddie Mac almost two years ago have been slow to gain traction. According to an Inside Mortgage Finance analysis of mortgage-backed securities data, the two government-sponsored enterprises purchased $10.31 billion of purchase mortgages with loan-to-value ratios of 96 to 97 percent during the first nine months of 2016. However, nearly half of that came in the third quarter, which saw a 52.7 percent jump from the previous period. Bob Ryan, acting director of the Federal Housing Finance Agency’s division of conservatorship, said... Read More

RE/MAX Launches Franchise Business to Put Mortgage Brokers in Real Estate Offices

RE/MAX Holdings is working to place mortgage brokers in real estate brokerage locations using a franchise model that the firm has used to become the top residential home seller. Officials at RE/MAX stress that the Motto Mortgage effort is compliant with stringent regulations regarding the mixing of real estate agents and mortgage offerings. Dave Liniger, CEO of RE/MAX, said many real estate agents and brokerages are eager to work closely with loan originators. “However, compliance remains... Read More

Supreme Court Justices Appear Willing to Let Miami Pursue Fair-Housing Lawsuit Against Mortgage Lenders

The Supreme Court of the U.S. heard oral arguments this week in a case involving novel lawsuits filed by the city of Miami seeking to recover damages from lenders. Questions and comments by Supreme Court justices indicated some disagreement but perhaps a willingness to let the city pursue its controversial lawsuit. In Bank of America v. City of Miami, BofA and Wells Fargo are challenging lawsuits brought by Miami under the Fair Housing Act. The city is seeking millions of dollars in damages, claiming that mortgages originated by the banks in the run-up to the financial crisis were predatory and counteracted the city’s efforts on fair housing, causing the city to lose the benefits of social, professional and business opportunities that come with an integrated community free from housing discrimination. Neal Katyal, a partner at the law firm of Hogan Lovells and former acting solicitor general of the U.S., argued... Read More

Analysts Believe Further MIP Cuts Doubtful But Stronger MMI Fund May Convince Them Otherwise

The question of whether FHA should do another mortgage insurance premium reduction is pretty much on stakeholders’ minds as they anticipate the release of the annual actuarial review of the Mutual Mortgage Insurance Fund next week. Analysts, however, are not ready to change their opinion that further MIP cuts are unlikely. Some analysts said they would reconsider their views if the upcoming report showed strong growth in the MMI Fund, while others believe FHA’s priorities today are different than they were in early 2015, when the agency cut the annual premium for forward mortgages to 0.85 percent. The FHA’s decision to lower the annual MIP was spurred... Read More

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